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No Better Time to Deploy Your Donor Advised Fund

Jimmy Zimmerman

Jimmy Zimmerman

Beaird Harris clients include individuals and families, businesses and healthcare professionals. Many of the individuals and families we work with prioritize charitable giving. One of the best vehicles to help our clients meet their charitable giving goals is a Donor Advised Fund (“DAF”).

A Donor Advised Fund (“DAF”) is a charitable giving account that is set up with your custodian to manage your charitable donations – think of a DAF as your “charitable checkbook.” You receive an immediate tax deduction when making a charitable donation to the DAF and you direct the custodian when to disburse funds (grants) to the qualified charity of your choice.

This strategy works well when an individual has appreciated securities (stocks or mutual funds) that he or she has owned for at least a year and would now like to donate. Once donated to the DAF, the assets can remain there until you provide further instructions on when the funds are to be disbursed to your charity of choice. This is particularly useful when an individual has higher-than-usual income, such as from the sale of a business or a large bonus. The individual can front-load several years’ worth of charitable gifting in one year (DAF gift) to receive a larger tax deduction that particular year. Then, the individual can direct smaller amounts from the DAF (grants) to qualified charities over the ensuing years.

If, like many, you give to various charitable organizations throughout the year, there is the added benefit of no longer keeping up with receipts for your tax records. Since your tax deduction comes from the contributions into the DAF as a qualified 501(c)3, your DAF provider will total your contributions made throughout the year and provide a statement each tax season that serves as your tax receipt.

Currently, non-profit organizations are struggling to meet the growing demands of their services and programs. Having a DAF in place for times like these is important to help meet the needs of your community. The funds are already there, ready to be deployed.

The recently passed CARES Act by Congress temporarily increased the deductibility limits for charitable contributions to encourage the support of many great non-profit organizations across the country.  If you would like to discuss the best charitable strategy for you to support the causes most important to you, please contact your Beaird Harris advisor.  We would be happy to provide more information about creating a DAF or how to deploy a current DAF balance, along with other charitable giving strategies.

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Beaird Harris Wealth Management, Inc.), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Beaird Harris Wealth Management, Inc.  To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Beaird Harris Wealth Management, Inc. is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the Beaird Harris Wealth Management, Inc.’s current written disclosure statement discussing our advisory services and fees is available for review upon request.

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